Meta has agreed to pay a maximum of $18 billion and to make changes to Facebook and other online services. The social networking giant is doing so to put an end to a federal lawsuit alleging teenagers are being harmed by social media.
Met’as settlement is with 48 individual US state attorneys generals, including four jurisdictions, reports the Wall Street Journal. The two outstanding states not involved in the settlement are New Mexico, which won in a similar trial in the spring, and Florida, which didn’t take part in the settlement.
Under the settlement’s terms, Meta will pay a maximum of $18 billion, but only if TikTok and YouTube also agree to the settlement. If not, Meta will only have to pay 70% of that figure.
TikTok and YouTube would each be required to pay a combined $5.3 billion between the two companies and abide by the same service changes as Meta. If they agree, Meta would also have to pay the remaining 30%, which is also $5.3 billion.
The settlement funds will be provided to the states in annual payments over ten years, per-state amounts will vary by population.
To fulfill the deal, Meta agreed to set a default one-hour time limit per day for underage users, while also introducing a “night mode” to block apps between midnight and 6 A.M. A “school mode” will disable push notifications between 8 A.M. and 3 P.M.
A federal judge will be required to approive the settlement before it is finalized.
The settlement also puts a stop to an ongoing trial involving the state attorneys general of California, Colorado, Kentucky, and New Jersey. The four states have alleged that Meta had violated state consumer protection laws as well as the Children’s Online Privacy Protection Act of 1998 (COPPA).
While Meta may have agreed to pay out an impressive settlement in this case, if the trial had moved forward and Meta had lost, they could have been forced to pay out as much as $200 billion in damages. Considering Meta will pay less than 10% of that figure, making it likely that Meta views the settlement as a victory.
This likely isn’t the end to similar lawsuits for Meta, as it still faces lawsuits from multiple school districts and individuals claiming to have been wronged by the company’s social media apps.